The $185 billion asset Citizens Financial Group (NYSE: CFG) , based in Rhode Island, posted disappointing second-quarter results, generating diluted earnings per share (EPS) of $1.46 on total revenue of $1.61 billion. EPS beat expectations by $0.37, but missed slightly on revenue. However, EPS would have missed expectations had Citizens not released $291 million of reserve capital previously set aside for pandemic-related loan losses but not used because of an improving macroeconomic outlook.
What was most disappointing about the report was the lighter-than-expected loan growth, despite the bank's somewhat unique consumer loan mix that had been expected to produce above-industry-average loan growth in the current market conditions.
Despite the underwhelming numbers, there is still reason to believe Citizens can outperform over the next several quarters. Here's why.
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Citizens Financial Disappointed in Q2, but Still May Outperform This Year